Transforming public procurement: The UK Green Paper
UK public spending soared during 2020 as the government dealt with the pandemic and prepared for a post-brexit UK. The proposals in the ‘Transforming public procurement’ Green Paper are intended to shape the future of public procurement in this country for many years to come.
Brexit means the UK no longer has to follow EU rules on procurement and the Government’s Green Paper looks at what replaces the EU procurement rules.
According to the paper the UK spends some £290 billion on public procurement every year. This huge amount of government spending must be leveraged to play its part in the UK’s economic recovery, opening up public contracts to more small businesses and social enterprises to innovate in public service delivery, and meeting our net-zero carbon target by 2050, Lord Agnew.
The Government’s goal, as set out in the paper, is to speed up and simplify our procurement processes, place value for money at their heart, and unleash opportunities for small businesses, charities and social enterprises to innovate in public service delivery. The current regimes for awarding public contracts are ‘too restrictive with too much red tape for buyers and suppliers alike, which results in attention being focused on the wrong activities rather than value and transparency’. The government wants a progressive, modern regime which can adapt to the fast moving environment in which business operates.
The papers mixed reviews
The publishing of this paper has brought about many different views and critiques on what the government has set out.
The Open Data Institute (ODI) is an independent, non-partisan, not-for-profit organisation who want data to work for everyone. When asked in a response to the paper, about whether they agree with the proposed legal principles of public procurement they :
“We strongly agree with the proposed legal principles of: public good, value for money, transparency, integrity, fair treatment of suppliers, and non-discrimination. These correspond closely with the principles of the ODI as expressed in our vision and manifesto. These principles are essential for a trustworthy procurement system, which we believe can be supported by an open, trustworthy data ecosystem.”
Others have argued that there needs to be clear and practical routes set out, and project techniques should be applied.
Adam Maddison, Director of client services at dxw, : “The Government needs to go further and commit to simplifying procurement for smaller players to help them have a real impact. Doing this would also make life easier for buyers for whom procurement is, more often than not, off-putting and time-consuming.”
The Local Government Association (LGA) is the national voice of local government and they work with councils to support, promote and improve local government. They stated: "It would be difficult in general terms to disagree with the legal principles of public procurement outlined in the Green Paper, however we do have some concerns."
These proposals set out by the UK government are historic for the country and if implemented, represent a considerable shift in public procurement in the UK.
Coupa Launches US$50 Million Ventures Fund
Operational resilience and agility. Following the events of the last twelve months, companies have focused on these strategic areas like never before. Some, as we’ve noted, have started to wonder whether this trend will continue post-pandemic—or will we go back to the same old supply chain? Not if Coupa Software has its way.
Last week, the company launched Coupa Ventures, a global fund that will invest US$50mn in early- and growth-stage companies that target business spend inefficiencies. “Coupa Ventures enables us to invest in a future where businesses and their suppliers can harness the power of their spend to constantly adapt, transform, and innovate”, said Rob Bernshteyn, Coupa’s Chairman and CEO.
What’s Business Spend Management (BSM)?
Let’s be honest, it doesn’t sound particularly sexy—it sounds like a subsection of the finance department. But business spend management, together with ERP (enterprise resource planning), CRM (customer relationship management) and HCM (human capital management) make up the core operating process of any company out there. When companies spend money, sign contracts, analyse supplier costs, take inventory or budget for the future, that’s BSM. Overall, business spend management is made up of three main areas: procuring materials, managing invoice, and handling expenses. Essentially, it’s the engine of the entire operation.
Why Change It Up?
According to Coupa, the next wave of BSM is now. It wasn’t always this way: in March of 2016, advisory giant Gartner claimed that BSM was dead. At that time, the firm was partly right. Companies couldn’t handle trillions of bits of data by themselves—and they were sinking as the waves of big data swept over their heads.
But recent developments have meant that BSM isn’t fated to die just yet. “The key to optimisation is data—and not just any data”, Coupa stated. The company has supported community intelligence, in which machine learning uses anonymised data from hundreds or thousands of client companies to suggest better spend tactics. This way, companies can get better insight into their suppliers, track supply chain disruptions, and investigate procurement alternatives.
This network effect is part of what makes Coupa Ventures so exciting. Said Eric Christopher, co-founder and CEO of Zylo, “We’re excited to join an expansive ecosystem of customers, suppliers, and partners”.
First Companies in the Ventures Portfolio
- Zylo, a leading SaaS management platform that helps companies manage cloud-based applications, offers visibility into what software is being used, how much is present, and how a company can optimise its software investments.
- SourceDay, a leading supply chain performance solution, bridges the gap between a company’s enterprise resource planning (ERP) and its supply chain network.
At SourceDay, Coupa’s investment is heralded as a chance for the company to really take off. “The investment from Coupa Ventures will...enable our joint customers to save money and leverage supplier performance as a competitive edge”, said Tom Kieley, SourceDay CEO. “We’re honoured to expand our relationship with the Coupa ecosystem”.
Looking ahead, Coupa will capitalise on community intelligence to help its partners make smarter spending decisions. “[Organisations will] place bets on which investments will quickly pay off to accelerate their growth and resilience in the post-pandemic economy”, said J.J. Freitag, senior vice president of Corporate Development at Coupa. “[And] we’re looking to back the best ideas across Europe and beyond to help businesses build back even stronger”.